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tv   Mad Money  NBC  November 1, 2012 3:00am-4:00am EDT

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crafts, sara. tomorrow, ambush makeover. >> real housewives of atlanta. >> see you at "scandalous" tonight. everybody. bye. i'm jim cramer and welcome to my world. you need to get in the game! they're nuts, they're nuts! they know nothing! i always like to say there's a bull market somewhere. "mad money." you can't afford to miss it. hey, i'm cramer. welcome to cramerica. i'm just trying to save you some money. my job is not just to entertain you, fwou educate -- but to educate you, so call me. new york city mayor mike bloomberg ran that sweet chime this morning, the opening bell to the new york stock exchange and suddenly wall street was back in business. and even though not all the markets implied -- nasdaq down.
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you could feel the blood flowing through the veins of the stock market after two days where its heart was stilled. it wasn't just wall street that opened for business today, though. the main street that runs clear across the country may now be opened as a new business, the business of construction. time for the final trade. the business of construction. yes, mother nature dealt a vicious blow and our hearts to go out to families who lost loved ones. but in spite of the tragedy, in our own curious way, sandy has given us the opportunity for a boost since the government rebuilt southern florida after hurricane andrew in 1992. a reconstruction so huge, it
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moved the country's entire gdp needle just when we needed it, after right a nasty recession. and now that we've assessed the damage, or we're trying to at least, i'll have to tell you one thing. i think this looks like a possible replay of that hugely bullish. right after a nastier recession. you couldn't tell that today to. ford with terrific numbers because they're connecting with the building materials industry. those stocks performed best today with the ones that took matters into their own hands. we spoke to queen harbors after it bought safety queen. to diversify away from the oil and gas business. queen harbors may have been up huge anyway, simy because, well, it's queens harbors. precisely what sandy ordered. buyers love the acquisition. $8.91. 18% gain for the good guys. tonight we're going to speak with two other companies that want to make you money.
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just in the last couple days. we'll hear from eaton. it will soon close on its acquisition of cooper industries. that stock rallied $2.10, even as people thought perhaps it should have gone down because it was an earnings myth. and then we have today's biggest gainer, pva, which announced it's taking over warner-co. how sweet is this deal? it caused pvh, the acquirer for heaven's sake, to sort $18.49. three big gains. >> house of pleasure. >> that's all well and good for individual stocks. we know that alone can't get these businesses moving higher. only growth can do that the despicable sandy has created the most shovel-ready jobs imaginable in an area that's desperate for employment gain.
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there's nothing like massive destruction or property infrastructure for putting people back to work, an unfortunate series of events that can deliver new jobs. now, i know that you've heard about closed retail stores, lost revenues, lost productivity. that's true, it's terrible, anne they will hurt the economy, but those are short-term in nature. and recoverable. i'm urging you to step back and take a look at the bigger picture. tens of thousands of homes experienced damage from sandy. those that are insured for storm damage will get their insurance checks and put thousands of contractors back to work, new begin sum -- gypsum board, new appliances and finally painting up a storm. the recent decline since blowout quarter. that's not the real spurt of the economy. that's also short-term. those homeowners who were directly in the path of sandy, and there were tens of thousands of homes that were, they can't begin to rebuild without government help, because many of
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them live on roads that have vanished. yes, vanished. so many roads need to be rebuilt. not just homes. but government provided infrastructure. it rises to national emergency. while the level of partisanship in politics has been horrendous lately, i don't care what party you're in, the spirit of cooperation we saw today between democratic president barack obama and new jersey republican governor chris christie could produce what could be the biggest public works project in a generation, to meet and entrust that national emergency. remember when president obama was elected, he said he'd put a lot of people to work in shovel-ready job. turned out there weren't that many jobs that were ready in. the wake of sandy, i don't think there are enough shovels ready for up and down the jersey and new york coast. these jobs will be created. this destruction, estimated between $30 billion and $50 billion. i think it's going to exceed that. maybe at least get to the high end. will finally move the employment need until this country. -- in this country.
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just as did did in the wake of hurricane andrew. now, when we look at industries that have been hardest hit since the great recession, the one that stands out the most is the construction business. construction business is about half of what it was six years ago. the culprit, banks that are afraid to lend, excess of homes, no need for new buildings and roads. the federal government doesn't need loans from banks. the federal government can cut immediate checks to get work done. the federal government is the only entity big enough for this job. and i think the emergency nature of it all will keep the situation from dissolving into partisan politics as usual. some projects are too big for the private sector. sandy is one of them. the real economy might end up being boostered far more than we initially thought, simply because the federal government is stepping up to get the job done. logan in texas. logan? >> caller: boo-yah, jim. hope all is well. >> it's all right. thank you, logan. thanks for asking. how are you? >> caller: i'm doing great. i think it was about two months i called you and i was asking
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about the stocks beacon roofing. ticker becn. you said you liked the stock but thought that it could get it at a lower price. since then, the stock has continued to rise and today in particular it had a spike. so i was wondering, do you think it's going to continue to rise or is it going to slump back? >> well, i'm glad that you called me on me, but i liked the stock but didn't tell you to buy it. that was a mistake. you should have been die -- buying it. i like beacon. beacon is a better trade. can it come down? i think it can come down, but this time you gotta buy it and it doesn't have to come down too much to pull the trigger. donna in texas. >> caller: oh, happy boo-yah, mr. cramer. >> same to you, donna. >> caller: western union. the bad bank announcements, how much have they affected the price drop? is there more to come and what do i look out for? >> i talk to more reporters here at cnbc about this one.
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i got to tell you, this just shows you that the business has gotten bad. there was too much that happened at western union. i'm going to be really candid here. had a lot of ceos on, and i did not get to check the full dimensions of how bad western union was. listened to herb greenberg talk to kate kelly. i don't have the goods so i'm not going to pretend that i do. karen in maryland. >> caller: i'm a first-time caller, longtime listener. my stock is bj's restaurant. ticker bjri. it's in 14 states and is expanding into the d.c., virginia, maryland area. took a big tumble last week and i was wondering what your take is on it. >> okay, i'm doing a piece for, talking about the notion of how this year has been the worst year for bottom fishing. bottom fishing has not worked at all. and i don't think it's going to work for bj's. once the stock seems to be broken in 2012, it stays broken.
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want something that stays broken? i'll tell you what. it goes away. don't buy that stock. the opening bell, it was music to our ears and i loved it. i think it also began a drum beat for the u.s. economy as well. as tragic has sandy has been, the rebuild will include many on its back. jobs coming. "mad money" will be right back. coming up, earnings alert. wall street's back online and cramer's got earnings season covered with an all-star lineup you can't afford to miss. industrial giant eaton fresh off its quarterly report. then, the ceo of apparel maker pvh soaring over 20% after news of a big acquisition. plus, the ceo of annie's. after falling from its highs, is it ready to run again? and tanger outlets ceo ahead of the holiday rush. this jam-packed edition of "mad
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every now and then, you'll find a company with stories so good kit transcend the quarterly earnings madness. take eaton and power management systems. the hydraulics and truck transmissions. this morning, eaton reported a 3% earnings and issued downside guidance. what happens? the stock goes higher, jumping about two bucks. why? because eaton is acquiring cooper industries in a hugely transformative deal. it closes this quarter. it's the reason they've been buying the stocks and it's the reason investors didn't care about some little headline earnings myth. plus eaton's also a hurricane place. their electrical units could be used in many of the repairs can down power lines across the northeast. plus, the effort to fix new york city's broken subway system. millions of people are still without electricity. let's check in with sandy cutler, find out more about the
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quarter and where his company is headed. welcome back to "mad money." >> thanks, jim, welcome back to "mad money." >> thanks, jim. it's good to be with you this evening. >> i have a customer base that is without power, in other words, eight million people without power. it would seem that the most natural call to make is to this new combined eaton-cooper to get that power back to people's homes. >> yeah, there's no question, jim. it's pretty basic. water and electricity don't get along real well. when you mix it with wind, it leads to terrible conditions people are having right now. we're anxious to help. a lot of our products will be used to getting important connections to people so they've got light and heat and power in their homes. >> i think people don't know the name eaton at home. the people in the industry do. could you tell someone sitting there waiting for power to come on where you intersect with the
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grid, both cooper and eaton. because cooper's got substantial business in that area. >> cooper, as we've seen in a number of our investor conferences, has larger content. working directly with utilities. things like pole transformers, important products in some of the unit substations. those are areas where obviously there's been a lot of damage here over the last couple days. as you get to the individual buildings and you get to the switch gear that you find in the basements, and which in many cases have sustained a lot of water, the network protecters are used in part of the grid there in new york city. if you think about some of the transformers in residential areas. you think about that box that you got your circuit breakers in, eaton would be involved in those areas. we have a broad array throughout the electrical power chain. of product and exposure. for those data centers that have gone through water damage as well, we would be involved in that activity of helping them get back operating as well. >> before the hurricane, i know there were a lot of things that were in your release that we have to think about.
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you talked about china, talked about problems in europe. but you directly referenced the fiscal cliff issue. how important is the fiscal cliff to be solved for eaton to be able to make its numbers in 2013? >> yeah, we do think that this issue, as we've approached year end this year, for many of our customers, the reality of trying to plan around this uncertainty has become much closer in. so while a year ago i think people found it interesting as sort of an academic sense to talk about the impact of the cliff, now they're really trying to figure out should they buy ahead of that or should they wait until afterwards. we do feel it's very important for a bipartisan team to come together, to really address these issues of coming to an agreement. having said that, even during this period of great uncertainty, our electrical americas business had an all-time record sales and profitability quarter. our electrical risk had a real resurgence in terms of its profitability and that goes back to the points you made at the
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opening of this session that our acquisition of cooper will bring to eaton now about 60% of our revenues will be in our electrical business, our strongest performing current business. >> as soon as the number came out, i went on twitter. that's what people do these days. saying oh, that's the perfect number. a lot of people said what are you looking at? obviously the earnings weren't that good. i'm looking at the operating cash flow and the margins which i thought were much better than i expected. >> there's no question, i've been talking to shareholders and investors about the issues. the economy was down shifting, that we'd be seeing a lot of number of these markets, large oems, startsing to reduction production levels. but in spite of that, our buy, were about $250 million short of where we thought they would be. our segment margins at 14.6% were strong. our balance across our business we think was impressive. and we think we carry into next year a good sense of momentum in what albeit is still a
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relatively slow recovery here in the u.s. and globally. >> but at the same time, it speaks to a number of companies that are involved in buildings, particularly in the shopping center and retail building. it seems like there's some pickup at mason, but some pickup going into the fourth quarter. >> well, i think all one has to do is travel around the major cities -- new york city is a good example of that. there's a lot more building going on than there was just a couple years ago. that extends pretty broadly across the u.s. it's not only in the nonresidential construction area, having moved from the sort of industrial side of nonresidential construction into the commercial, as you noted. also we're seeing this uptick in residential construction. it's not a breakaway, but clearly we think we're on our way back to 1.5 million housing, that seems to be the sustainable number. that's a couple years out from where we are today. but family formation would support about that type of activity. so we still see real activity supporting this electrical
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business we have. >> i'm going to leave it on that note because i like it, it's a high note and i feel like that is exactly how i should be thinking about the new eaton, which is a tremendous combination right for this time. sandy cutler, thank you for coming on the show. >> thanks for having us on boards. the stock goes up, too. why does it go up too? because it's better than expected and the combination of eaton and cooper is very powerful. yes, the hurricane, tragic as it is, someone is going to have to provide the equipment for that power grid. it's going to be eaton. stay with eaton. stay with cramer. coming up -- pvh made things official today, making a bid for calvin klein licenser and wall street was funded by sending its shares sky-high. time to dress your portfolio with this massive apparel maker? don't miss cramer's exclusive with its ceo. and later, silly rabbit? organic food maker annie's has been hopping since its ipo
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earlier this year. after falling from its highs, is the stock better left on the shelf, or is it ready to run again? it's your earnings edge when cramer talks with his ceo. plus, 'tis the season? the storm brought much of the east coast retail world to a halt. but as the cleanup begins and holiday season nears, there seems to be a surge of shoppers. cramer is talking to the ceo for his outlook just ahead. all coming up on "mad money." at cepacol we've heard people are going to extremes to relieve their sore throats. oh, okay, you don't need to do that. but i don't want any more of the usual lozenges and i want new cooling relief! ugh. how do you feel? now i'm cold. hmm. this is a better choice. new cepacol sensations cools instantly, and has an active ingredient that stays with you long after e lozenge is gone. ahhh. not just a sensation,
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about six weeks ago i recommended a company called warnerco. they license the calvin klein brand of jeans and underwear and said they could easily be a takeover target for pvh because pvh would be able to exploit their assets. sure enough, this morning we find out that pvh is indeed buying warnerco. for a 35% premium. what's most impress sieve that -- what's most impressive is that pvh shot up $18, 20%, as this $2.9 billion deal expected earnings in the first year. that's why i cannot believe that the excellent chairman and ceo of pvh here with us tonight to talk about this deal and what it means for his company's future.
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welcome back to "mad money." have a seat. >> thanks a lot, jim. nice to be here. >> exhausting days even for the hurricane it's exhausting. >> trying to get this deal done, the storm aftermath really was a challenge for us. but we really came together. >> let's talk about this deal. because your company has a history of buying brands, combining them and doing an unbelievable job, tommy hilfiger. but this is really your sweet spot. you already have some of the house of calvin. what does it mean to have all of it? what will it do for all of it? >> i guess there's two points. first of all, acquisitions, integrating them is always tough. when you can take out some of the risk, when we know the calvin klein brand, when we operate with about a billion sales of calvin klein already. we know what needed to be done. second dare -- secondarily, i think it will really solidify
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the brand's position, allow us to really cohesively bring the calvin klein brand to our consumers in a way that we can't do now with a license or a licensee relationship with warnaco. >> were you shocked that your stock looked like it was acquired today, that it was up 20% on this news? >> yeah, i guess i was somewhat surprised. i expected a positive balance. you talked about it about six, eight weeks ago. it's a deal that everyone i think understands the industrial logic of the transaction, so it's hopeful that it will be a positive bounce. but the 20% bounce really was pretty astounding. >> that's a testament to what you did with tommy. there's a couple things that stand out to me. i've been waiting for you to go big in asia and latin.
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this is it, right? >> this is one of the advantages that warnaco gives us and one of platforms they have they have an operating platform in latin america and in asia where they're over 750 to $800 million in businesses in those two markets. so they have great commercial operations there. retail operations in countries like india, korea. they've been growing in excess of 15% to 20% a year, and in latin america where they've been growing in excess of 30%, this really gives us a leg up in geographic areas where we didn't have operating platforms. so you combine that with our $1.5 billion platform in europe and our $4 billion platform in north america, it really gives us a leg up on most of the other apparel. and competitors. >> we have steve tanger on. tanger factory outlet today. great partner of the calvin klein brand. you're going to keep that
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strategy, right? >> oh, absolutely continue to grow that business. we see ourselves with the jeans and underwear business in north america really being able to enhance that business. warnaco is a large company, but about $800 million in sales in north america. us with about four billion. clearly gives scale and leverage to the calvin klein jeans and underwear business. >> you have a heritage business. in their call they talked about a heritage business. i would have thought that you would have had no interest in speedo, but totally wrong. you're going to blow it out, aren't you? >> well look, we love brands. we love strong brands that really have a niche in the market. speedo is the swimwear brand throughout the world. this gives us that business. we have a great management team on the west coast that has done an amazing job with that over the last three years in particular. high operating margin business at 15%. it's a business that really -- we were surprised when we did our due diligence, just how
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strong it was, how strong that management team was. so we're excited about it. clearly the driving force of this transaction was calvin klein, but this was a great gift purchase. >> okay, we discussed the underperformance of calvin klein jeans. so what happens? you close the deal. what immediately happens to manny? what does manny do to make those jeans sell better? >> i think in the business of calvin klein's jeans business, the toughest markets have been north america and europe. i think that's where we bring strength. with our relationships with the department stores. with the strength of the call -- calvin klein brand. all of our businesses are up about 9.5% in north america. it's clearly somewhat of an execution market on the product side. the focus will be on product, improving that product. investments a point and sale, at retail to really enhance the brand's presentation.
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i think we know exactly what needs to be done in north america. and our management team in europe, that's done such an extraordinary job with tommy hilfiger, along with the warnaco management team. i think with that infrastructure and a much larger operating platform, can really take that business and turn it around and bring it back to its historical levels of profitability. that approach 15%. >> can't resist. october looked looked like a good month for you guys. >> october was a very strong month. as part of the announcement, we updated guidance. we were just recently upgraded about four weeks ago with our analyst presentation. so business has been strong. the third quarter very strong. calvin, tommy both in the high business. our heritage business, relatively flat. tommy's european business, comps are running up 15%.
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i'm not aware of anyone doing that well in europe. >> no one is doing that well in europe. other than you, no one. congratulations. manny chirico. this is why i want you to be in his stock. good things happen when good managements are doing good things for the shareholder base. stay with cramer. thank you, manny. thank you. coming up, are you ready to get charged up? cramer cranks up the voltage and goes electric on an all-new "lightning round."
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all right, cramerica, we're just over a week away from this year's salute to the troops veterans day show. make sure you head to for free tickets to the show. you can join me and some genuine american heroes in studio next friday. and now, it is time for the "lightning round." and then the lightning round is over. are you ready? i'm going to start with anuj in new york. >> caller: boo-yah, how are you? >> bring it on! >> caller: all right, we got lazboy. solid earnings. what do you think? >> we're not going to be buying
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lazboy. i prefer ethan allen. get some restoration hardware on that ipo. to illinois now, i want to go to jim in illinois. jim! >> caller: boo-yah, jim. this is jim from evanston, illinois, home of the northwestern wildcats. we love you. >> and i love northwestern. i like their programs. what's on your mind? >> caller: my question is rimm, should i buy or sell? >> no, we're not buying, no, no, no. they just had that group of people that subscribe to it but it's declining. salvatore in florida. >> caller: a big, big boo-yah from florida. >> i like that. go ahead, sunshine. >> caller: cisco. >> you know what? cisco, i thought they had a great quarter. i thought that things were starting to go well. and now i'm not thinking that
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way because telco spending is so bad, so i'm going to have to say stay away until we see the next quarter. let's go to joe in texas. >> caller: cramer, how are you? >> real good, how about you? >> caller: good, thank you, sir. mpc broke off. marathon. what do you think of that? lastly, my father-in-law, my uncle both early 60s think our economy will die if the president barack obama wins a second election. your opinion? thank you. >> i'm not a political guy. don't care for that question. marathon, i like. let's go to rob in florida. rob. >> caller: jim, a florida state happy halloween. booyah! >> caller: my stock is ssys. >> yeah, you know, we looked at this company before. it's digital manufacturing. i am not going to opine on it.
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i've got to do more work on it. i'm not fresh enough on it. i promise you, i'll get back. matt in new york. matt? >> caller: yes. hi, jim, i want to give you a big boo-yah from up state new york. i appreciate you very much. nye capital management. >> this is tough because mike farrell is no longer at the helm, but they assure me that the group that are running it now are excellent, that's after i said i'm a little nervous because mike is not there. mike unfortunately passed away. but the team is a good one. no need to sell. no need to sell. let's go to greg in mississippi. greg? >> caller: thank you for taking my call, mr. cramer. quick question, nordic american tanker, nat. >> you can't be in the tanker stocks. there's still tankers coming out. you can't be in the tankers stop. still buying more tankers. this group has just got -- i don't want to recommend any stocks in the group. i've been saying -- i just don't know.
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let's go to bill in missouri. bill. >> caller: hey, jim, how you doing? >> real good, how about you? >> caller: real good. i called to ask about clean energy, clne. >> got downgraded today. made a lot of sense because westport announced bad numbers during this break. what happened? they're saying that there's not enough of a quick buildout of lng gas stations. you can't own these because they're not getting the support of the car makers or enough truck buying. they're good specs and that's it. how about silvia in florida. >> caller: hi, jim. boo-yah from boca. i want to know that i'm a longtime fan, and i first saw you on tv when you were with larry kudlow. i love your high energy. >> thank you. >> caller: your sincerity and your wealth of knowledge. my stock is f-5 networks.
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it's gone down 20% since i bought it. should i hold it or sell? >> no, no, it's a slow-down. bottom fishing does not work. you have to go. i do not want you in at five. it's just not working. that is the conclusion of the "lightning round"! >> the "lightning round" is sponsored by td ameritrade. coming up, silly rabbit. organic food maker annie's has been hopping since its ipo earlier this year. but after falling from its highs, is the stock better left on the shelf or is it ready to run again? get your earnings edge when cramer talks with his ceo. [ male announcer ] alka-seltzer plus presents the cold truth. i have a cold, and i took nyquil, but i'm still stubbed up. [ male announcer ] truth is, nyquil doesn't unstuff your nose. what? [ male announcer ] it doesn't have a decongestant. no way. [ male announcer ] sorry. alka-seltzer plus fights your worst cold symptoms plus has a fast-acting decongestant to relieve your stuffy nose.
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thanks. [ male announcer ] you're welcome. that's the cold truth! [ male announcer ] alka-seltzer plus. ♪ oh what a relief it is! [ male announcer ] try new alka-seltzer plus severe allergy to treat allergy symptoms plus sinus congestion and pain. until they see this. the oral-b pro-health clinical brush. its pro-flex sides adjust to teeth and gums for a better clean. the pro-health clinical brush from oral-b.
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normally i tell you to stay away from stocks right after they become public, but at the beginning of april i made an exception. i told you to buy annie's. it's a natural and organic food company that had just gone public and soared 89% its first day of trading. at the time the stock was the 34.65. annie's rallied up to $48, and pulled back to $39 and change. that's still up 14% from where i first reported it. last night annie's reported a miss quarter but shares are better. let's find out from the ceo of annie's. welcome to "mad money." you have what i call a high quality problem, in preparation for sandy, i went and got my staple. i got five boxes, one of the last ones, your mac and cheese,
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which by the way, we went back to try to get pots of and couldn't get any. you're out. >> i'm sure that the shelves were empty. i'd just like to say our heart goes out to all the folks in new jersey and new york that were really affected by this storm. and across the eastern seaboard. businesses are important. but your family's held and safety is the most important, so i just wanted to say that. >> thank you for pointing that out. you can't say it enough and i am here and i see it and i know it and i thank you. there was throughout your conference call and your notes a theme, which is that your biggest problem is you've not been able to keep the stuff on the shelves. you would have done much better in your numbers -- you berated yourself for not having enough product. >> we like to take credit when we execute well. this last quarter, we could have sold more mac and cheese. we didn't forecast it right. we were a little slow to react. we left some sales on the table. we reported 20% growth in the quarter. we probably could have done 22%,
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23% if we'd executed better. but we like to call it like we see it. we have a great brand and we're in a good spot and we just need to execute at a high level. >> you're making a big transition in the stores. you're going from being in that isolated aisle of organics to being mainstream. what does that mean for your company? >> well, it puts us on a much bigger stage. we've been over in those dusty natural food sections that you've probably seen for quite some time. now we're positioned much more in the mainstream shelf. in this last quarter, we actually moved 17,000 sku points of distribution from the natural section over into the mainland aisle. what that does for us, it puts us where consumers want to shop. more consumers want to buy natural and organic but they also want to do it in a convenient way. that gives us the best growth opportunity going forward. >> does the supermarket tell you we're going to move you over? are there slotting fees where you pay them to move over? it would seem to me that your
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presence in the supermarket is so much bigger than it was a year ago. >> it's grown a lot. we do pay slotting oftentimes when we go to a mainline aisle. it's one of the best return on investments that we can make, so we're happy to do it. the key is just convincing the chain and the people making the decisions that natural and organic is really not a fad. it's a very mainstream idea and this consumer that's attracted to natural and organic products is a really strong consumer. college-educated. great income. really loyal to stores that do a good job for them in this area. so we make that story and when we move over, we really drive category growth for the retailer. we drive more profit for the retailer and everybody wins, so it's a good story. >> we were talking last night about the cheddar bunnies. i said to myself i don't know why, i always feel like because they're organic and natural, that they're not fattening. but it is true, organic and natural does not necessarily mean that you're going to lose
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weight when you eat it. >> it is true. we try to -- the main reason that consumers tell us that they want to buy natural and organic is they're trying to avoid artificial ingredients, synthetic growth hormones, genetically modified ingredients, things that you've been talking about on your show in the past. we try to do that. we also try to build positive nutrition into our products. we try to build a lot more whole grains, lower sodium levels, lower fat levels if we can do it. but the most important thing is that we really try to deliver great taste. at the end of the day that is the most important thing. people will buy anything, but it has to taste great and the family's got to love it. >> last question, pizza. looks like it's another home run. >> it's doing really well. it's still a little early. we're just getting the made with organic pizza line out into grocery stores. about 2,500 grocery stores. over this last quarter. it's getting out into natural food stores. but the early results look really good and we're very optimistic about it. pizza is just our first extension. the much bigger strategy is annie's in frozen.
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we announced on our earnings call that we're beginning to do some real work and some additional extensions in frozen for fiscal 14 and 15 as well. >> all right, sir. thank you so much. it's great to see you. if anyone has kids who are teenagers, you know this brand is one that they request. thank you so much for coming on the show. >> nice to be here, thank you. >> guys, you know how i feel about whole foods. add annie's. i have not recommended stocks in the after market because i didn't think they had staying power. this one does. yes, it's expensive, but they could have done even better had they just been able to meet the demand. coming up, 'tis the season? the storm brought much of the east coast retail world the a halt. as the cleanup begins and holiday season nears, the tanger's outlet could see a surge of shoppers. cramer is talking to the ceo for his outlook just ahead. wooohooo....hahaahahaha!
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resale was one of the hottest sectors out there. now the market is back open, retail is working. i know it still works. just take a look at tanger factory outlet centers. owns 40 outlet centers, 28 different states. it has a solid yield. company has raised its dividend every single year since it came public. more important, tanger reported last night, raising low end of its guidance. even better, the company's occupancy ratio rose to 98.6%. healthy temperature. let's hear from the ceo to hear more about the quarter and what's happening. welcome back to "mad money." >> thanks, jim.
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how you doing? >> you did it again. just fantastic numbers. getting used to that. you bought a couple in 2011. you got a place in rehoboth beach, a player in maryland. how are they stacking up after the hurricane? >> well, thank heavens, the hurricane came through. there was a lot of water that came up through the city, which is still closed, but fortunately, the damage to the stores does not appear to be as bad as the photographs showed, with the exception of atlantic city and our center in westbrook connecticut, all of our properties are open. >> atlantic city just has to go through the renewal process, right? >> well, we have no loss of rent and our tenants are closed for a day or two, but we'll see what happens. we don't expect any impact on our revenue, our percentage rent, and certainly not to our base rent. >> let's talk about how you got to 98.6 in an environment where everyone is still worried about retail.
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that means you're still signing people up. are these companies that formerly decided they didn't embrace the outlet and now are, or is this just more of the same, more under armor? more of a higher end guidance, more j. crew? >> people love the outlet. people love the bargain. they demand bargains in today's environment. everybody that manufactures almost anything today has an outlet distribution channel as part of their corporate strategy long-term. you mention under armor, they're great partners. but they've only been in business less than ten years. they've been public seven years. part of our skill set is identifying tenants of the future. which we want. we don't want tenants of the past. >> the ones that have been obsoleted by amazon do not have -- they just never went outlet. >> they did not. our products are basically apparel and footwear, sizes, colors. we do not sell computer hardware, books, things that are easily bought on the internet
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where you can get the best price on a commodity item. we sell fashion. we sell things that make people feel good about themselves. >> okay. now, you are also doing something that most people aren't, most companies aren't. you're actually building. you're actually building new centers right now. >> jim, we're a growth company. we're a dynamic company. we have ten projects in various stages of development. six new development projects and four expansions, both in the united states and in canada. actually, we just announced yesterday morning, we purchased two centers in montreal. one northwest of the city and one due east of the city. we will have a head start in canada as we roll out our canadian strategy. >> are there enough people in canada to make a difference? i said how many could you really open there? >> well, we have identified with our partner rio-can development trust, about ten sites which we think we can roll out over the next five to seven years. we have purchased three.
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we have expansion capacity in each of those three. so we're well along executing the project. >> the dividend increases consistent, 5% most recently. if you get up to, say, 99.9 and then you stay there, how do you raise it each year? you have a 21% increase in the rollovers, right? >> well, our rents continue to be driven -- we were actually -- our rent spreads were 25% year to date. but that's a reflection of our tenant sales, which are way up. the tenants can afford to pay a little bit more. it's a very profitable distribution channel for our tenant partners. our ability to raise dividends, which we have every year since we've been public, is a reflection on our cash flow. so right now we're 98.6% occupied. the cash flow is terrific. our dividend is covered by about 150%, so it's very safe and very secure.
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>> okay, not everybody -- coach a big customer of yours. just okay, getting a little better. decker is not really affiliated, but not doing that well. do you monitor a coach and worry when you see that stock go down? >> the management of coach is highly skilled and very professional. they've been long-term partners of ours for close to 20 years. they have a lot of confidence in their ability to do the right thing. they tested the pricing strategy for about 30 days, didn't work and went right back to the original strategy of discounts and rewarding and thanking their customers for shopping at coach. we don't have any decker stores, so i can't really speak to them. we monitor sales every month, we get sales of virtually every tenant in our portfolio. we have a highly skilled and well-trained marketing group that works with our tenant marketing groups to drive traffic. thank heavens, traffic has been up every month this year and
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hopefully it will continue through the holiday season. >> well, you're just a great story, as always. and it's been remarkable to watch you consistently do everything right ever since the company became public. >> thank you, jim. we hope to do it for many years to come. >> one of those guys that convinced me to start looking, and what a great win it has been for everybody who has watched this show for the last eight years. this is the kind of stock that is key to a balanced portfolio. nice growth and great yield is what this business is really supposed to be about. stay with cramer. stay connected to cramer on you can help others along the way. ♪ ♪ a portion of every bottle that they sell goes to fight ♪ ♪ breast cancer and i think that's swell. ♪ ♪ the more you take, the more they'll pay, ♪ ♪ so make them write a big check today. ♪ ♪ and if you're feeling a little slow, ♪
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♪ then 5-hour energy will help you go. ♪ ♪ so buy a bottle of pink lemonade and ♪ ♪ you can help fight breast cancer today. ♪ [ woman #2 ] even my laundry started to get a funny smell. [ female announcer ] just three uses of tide washing machine cleaner will help remove odor-causing residues and leave your high-efficiency washer clean and fresh. clean laundry starts with a clean washer.
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let's go over it. annie's. i think that stock is going to go much higher over time. pvh, a terrific story. i know i'm not going to tell you to buy something up 19 points. tanger, good over time, which es


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